Southland District Council looks at rates affordability
The cost of replacing ageing infrastructure and meeting higher environmental standards is having an effect on the Southland districts relatively small and geographically dispersed population to pay for rates, a report to council says. Southland District Council finance development co-ordinator Nicole Taylor has prepared a Southland District Rates Affordability Assessment report, which will be tabled at a full council meeting on Wednesday. While council rates are affordable on some levels, the report recommends low-income households in the Southland district be able to remit or postpone some rates payments. Rates make up 66 per cent of the councils revenue and are currently a significant determinant of councils financial capacity. READ MORE: * Mackenzie slips to second lowest average rates in New Zealand * Auckland's middle class plummeting down property ladder * Te Anau community hub feasibility study to go ahead in spite of public resistance A community must be able to be afford rates now and in the future in order to sustain the services being provided and ultimately contribute to the wellbeing of the community, the report says. Taylor says in the report that at a distributional affordability level (individuals or groups of ratepayers), rate affordability issues are more apparent in pockets of Southland where median household rates are above 5 per cent of median household income. At the household level, the issues are most evident in urban areas with low income levels and a high proportion of fixed rates, in particular service rates like water, sewerage, rubbish and recycling. Areas of Ohai, Nightcaps, Riverton, Otautau, Tuatapere, Wyndham, and Lumsden all have median rates more than 5 per cent of median household income, and trigger multiple other affordability indicators, Taylor says. The analysis shows some rural areas, such as Wairio, Kaweku and Fairfax, also have median rates more than 5 per cent of median household income, but this is the result of higher property values (and value-based rates) associated with farms, particularly with few of the other social/economic wellbeing affordability indicators triggered. The report recommends that councillors note that overall 2019/2020 rates are affordable at the community (aggregate) level. It also recommends that councillors note that distributional rate affordability issues are more apparent for low income households, and requests staff to investigate whether there is a need to provide specific assistance in the form of rates remission or postponement for low income (owner occupied residential) households, considering the assistance already available for low income households via the government accommodation supplement and rates rebate scheme.